Information and Consulting

Tuesday, October 22, 2013

Fighting words, I know. Pejorative on so many levels.
Insulting even, but that’s what we’ve come to. After reading great posts by Joel Kotkin, Wendell Cox, and some miscellaneous pieces in the WSJ, that support what I’ve been saying for the last few years about regulations and “Feeling Better About Ourselves” (FBAO) ordinances I have come to the sad conclusion we in California are doomed. Doomed like Illinois, Michigan and many other states.

But California is the worst offender because it is so correctable and
obvious. It is the simple fact that state is controlled by those who wish to
give away what others have earned. And when that runs out you end up with a
Michigan and Detroit or an Illinois and Chicago. Sad but true, but FBAO.

California, when I emigrated back in 1971 from Illinois and
Michigan, was the place to be. It was the greatest and coolest spot on earth with an
endless coastline, bustling cities that were affordable, a sane politic, and an
adventurous soul and an expectant population for its future.

What happened? FBAO.

There is no easy answer and yet I will try to give a small
opinion, my own. One word comes to mind, self-satisfied. We no longer reach for
the stars whether Hollywood or Vandenberg, we have become a creator of toys
(IPads, Google, Facebook). We no longer dig in the soil for wealth (gold,
silver, cotton, oil, and even lumber), we let George, or Juan, or Chin do it.
We became a state of renters and preservers, even though our history is less
than two centuries old. We became self-centered as well, FBAO. Sad.

The state is now striven in two. A coastal state that is no
more than fifty miles wide, a coastal zone unaffordable to all but
the richest and oldest (equity my dear, equity). A zone that does its best to restrict,
shun, prevent, and obscure every attempt to grow and deal with changes to its
population and economy. “Let Silicon Valley do it,” seems to be the most common
hope. Even the Southland dreams of redemption in its own version called Silicon
Beach. We are now just cute, not cutting edge.

And most of this is due to over-regulation and
protectionism. In 1970 there wasn’t a Coastal Commission, Water Quality Control
Board, Bay Conservation and Development Commission, Air Resources Board,
affordable housing laws and agencies, waste management agencies, Environmental
Impact Reports, and so many other agencies they bump into each other like teenagers at
a Rave. And somehow we managed to built a great state. While the ordinances have done some good and in many cases a lot of good, they
have also slowed the engine of the state to a dead stop crawl.
When there are no expectations, no hope, entrepreneurs move on taking jobs and capital
with them. I see Texas waving its flag on the horizon.

What is left is chaos. Drug labs hidden in derelict valley
towns and dying orchards, an empty landscape where hundreds of thousands of
acres of crops once grew, battles over how much water someone gets versus
building greater and greater water supplies, a sad pleasure in returning to the
native, and the belief that denser and denser urbanization is the future. FBAO.

We are squandering our resources and capital. Witness the battles
over city and county land use boundaries that drive up housing costs, a high
speed rail that will fly through
counties desperate for jobs and growth, fracking that will produce thousands of
jobs and billions for the state, new land laws (by coastal legislators) making
Central Valley growth more costly and difficult, and the ongoing subsidies for coastal housing that tries to create affordable housing instead of expanding the
overall housing count and thus making housing more expensive and unaffordable, and of course the omnipotent power of the public unions as we have seen in the
BART strike. Much of this driven by entrenched political and cultural
groups with specific agendas and a relentless and tightening grip on the state’s
purse.

It is very hard to accept that at some point this state
will run out of credit, it can’t print money (though it does try, by proxy, to sell
bonds for its future), and it can only expand taxes on its people and businesses for so
long. It will begin to lose those people it needs to retain. California will still grow
but is it the type of growth that this state needs? I believe in demographics,
but what kind of demographics is important. Education is paramount, so is
affordable housing, and so are jobs. California desperately needs adult
supervision, even though, I guess, the adults along Coastal California seem to
like it the way it is and they of course FBAO.

Thursday, October 3, 2013

At the barbershop this morning there was an
interesting discussion about parking meters and rates. Seem our little town has
decided to go big time and now charges up to $2.00 an hour for the privilege of
parking on our city streets. Of course this is denied by the city as a revenue
generator, it is to insure an adequate turnover rate on the streets. Higher hourly
rates equal more street parking. This is an old argument dating from the advent
of the parking meter. The city wants you to use their parking garages (not the
free ones at the adjacent mall). The prices at the garage are a little less and
the machines more convenient (yeah, sure). The bottom line is the bottom line;
it is about revenue, revenue to the city and the incredibly high parking fines
(with surcharges) that are being stuck under your windshield. The more inconvenient
you make something the greater the resistance to its use. There may be gains in
the short run, but in the long run you will turn customers away.

Storm
Drainage:

With the increase in agencies and their desperate
need to justify themselves we planners and architects are at the cutting edge
of their desire to make our planet cleaner. They can’t do it without us so they
have to create ordinances and guidelines that make sure we toe the line. The
most contentious issue (at the moment) is the statewide California water
quality requirement of treating all surface runoff on site before it leaves the
property and joins the rest of the region’s storm drainage (ditches, creeks,
streams, rivers, etc.) This is done through the standard design of a fascinating
treatment basin that requires all run off to pass through before leaving the
site. For one small forty by forty foot basin in a multiunit residential
property we are involved in we have had more than ten meetings to figure out
how to make the residents happy. They claim these basins are 1) Unsightly, 2) Unsafe,
3) Dysfunctional, 4) Lower Property Values, and a myriad of other negatives that
include contributing to West Nile disease and swamp fever. And that’s just the
homeowners. The real issue will be when they discover how expensive they will
be to maintain; they have no idea, yet. Besides the homeowner issues, they just
plain do not work. They are designed to too close a tolerance and with any sort
of 100 year storm will fail miserably and even dangerously. Will this state
ordinance be repealed? Not a chance.

Housing:

Will the government shut down cause the nascent housing
market to fail? Really don’t know, the marketplace is a flexible beast and
there will be work arounds to be sure. The sad part is the massive impact it
will have to those desperately trying to buy or sell a home right now. The FHA
controls far too much of the lending market, and we see with its current ‘shut
down,’ this impact across the housing markets. A week may not make a difference,
just look where we have been the last five years, but confidence is a sticky commodity
in today’s world. If one public bank controlled as much of the lending market
as the FHA the government would break them up. They did in telecommunications
with AT&T, but I doubt they will do it to themselves. Maybe Canada with
their far better banking system should get into our residential market. They
certainly could do no worse.

Electric Cars:

Yesterday a Tesla car caught fire and the footage
was on all the news stations. Their stock was down 7% at last check for a car
that is exceptionally cool. Now I’ve gone after the electric car market for the
past three years, mostly due to the government subsidies: Why should I pay $7,500
(and more) for some dilettante rich environmentalist’s $100,000 car? And I
still believe that at any price for any electric vehicle. If the market is
there they will sell. And they are beginning to sell. This whole thing with the
fire will be fixed; the marketplace will absolutely demand it. If Elon Musk
doesn’t fix it he’s toast (pun intended). And by the way when I fill my Volkswagen
(22 gallons and an FHA loan) I have so much explosive power in that tank I don’t
even want to think about it. The electric car catches fire and burns, true; but
my SUV catches fire, it explodes, and
spreads the burning fuel across the pavement. Just saying.

BTW: The feds aren’t sending an investigating team
to find out what really happened, they are off work due to the government
shutdown. And how many teams did they send out when that rear end Pinto exploding
thing happened back in the early 1970s? Just asking.

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About Me

Greg was born in 1949 in Traverse City, Michigan. Raised near Chicago he moved to California in 1971. The son of a journalist and entrepreneur, Greg has never forgotten his roots; his non-fiction work has focused on the Midwest region. Californian by choice, Mr. Randall makes his home in Walnut Creek, California with his wife, constant companion, and business partner. His preferred fiction genre is mystery/thrillers and historically based novels.